Competitive energy option in the long run | india | Hindustan Times
  • Thursday, Jun 21, 2018
  •   °C  
Today in New Delhi, India
Jun 21, 2018-Thursday
-°C
New Delhi
  • Humidity
    -
  • Wind
    -

Competitive energy option in the long run

Rising energy demands stymied with limited fossil fuel, spiralling oil prices and global warming have put back nuclear energy on the energy mix.

india Updated: Mar 20, 2006 19:28 IST

At the World Economic Forum in Davos this January the focal point was nuclear energy. Companies like Areva and GE gave several presentations to Indian and Chinese delegations sensing the two countries’ massive energy requirements.

With India’s power demand projected to increase five fold by 2030, these presentations made business sense, especially when the government wants to augment nuclear energy from present 3,000 MW to 20,000 MW in the next 15 years.

Worldwide there’s a revival of the nuclear industry. Rising energy demands stymied with limited fossil fuel, spiralling oil prices and global warming have put back nuclear energy on the energy mix. From 1990 till now global installed capacity increased from 327 GW to 366 GW. Globally there are 439 reactors in operations in 31 countries and produce 16 per cent of the world’s electricity. The nuclear industry is worth $125 billion and is growing.

The biggest dampener for nuclear power is high investment and long gestation period compared with coal, gas or hydro sources. According to International Energy Association estimates, capital cost for nuclear power is around $2,500 per KW and for coal it is $1,000 per KW. Typically, 73 per cent of the total cost in nuclear power is capital, compared to 27 per cent in coal and 16 per cent in gas.

But then the biggest saver is the fuel cost, which is 15 per cent in nuclear, 60 per cent in coal and 74 per cent in gas. Even operation and maintenance cost is quite comparable. Overall, the cost of nuclear power ranges between $21 and $31 per KW depending on the size and life of the plant. Gas-fired plants costs between $37 and $60 per KW and coal around $50 per KW.

But despite the positive cost-benefit analysis, a MIT study argues that nuclear power is only effective as a long-term investment since the benefits come after two decades of the reactor’s operation.

Currently in India’s energy mix, thermal power accounts for 56 per cent followed by hydro at 25 per cent and gas at 11 per cent. Though India has abundant coal resource, its technology is outdated. Moreover, Indian coal is high on ash content and has to be mixed with low ash coal imports. Thermal plants are cheap to operate if they are located near the mines.

A Nuclear Power Corporation study says if the plant is more than 1,000 km away from the coal pithead, as most of our power plants are, then nuclear power is competitive.

Gas plants with uninterrupted fuel supply have cost advantage over coal and nuclear energy. However, these benefits remain elusive since India imports 75 per cent of its gas without a single pipeline in place.

Our nuclear power programme has slowed down due to fuel constraints. Though India has a huge thorium reserve, our uranium deposits are limited. Our strategy for large-scale deployment of nuclear energy should be to use thorium through improvised reactors.